Assessing the Benefits of Using An

Assessing the benefits of using anenterprise system in accountinginformation and management

Charalambos Spathis and John AnaniadisDepartment of Economics, Aristotle University of Thessaloniki,

Thessaloniki, Greece

Abstract

Purpose This paper examines the impact of decisions stemming from the new ERP system on theaccounting information and management implemented at a large public university in Greece, based onperceived benefits according to users expectations and perceptions.

Design/methodology/approach Structured questionnaires were used in two measurementpoints (pre- and post-implementation) in the frame of longitudinal research. The statistical analysismethods employed factor analysis and Cronbachs alpha to evaluate the scale and t-test to assess thesignificance of the means values between the two periods.

Findings The results show that, one-year post-implementation, users perceptions are morepositive compared with their expectations from the pre-implementation period. The empirical dataconfirm a number of benefits derived from the new ERP system, particularly in relation to accountinginformation and management. The new ERP system significantly contributes towards increasedflexibility in information provision, through effective monitoring and exploitation of the universitysassets and revenue-expenditure flow, and improved decision making.

Originality/value The empirical evidence can help the university and other public organisationsto establish the best way forward in fully exploiting the ERP systems potential as an innovative toolfor management.

Keywords Manufacturing resource planning, Expectation, Individual perception,Accounting information, Greece

Paper type Research paper

IntroductionThe widespread adoption of enterprise resource planning (ERP) system by large andmedium-sized organisations, described as the ERP revolution (Ross, 1999), has beenthe source of particular interest in recent times. In many organisations, this hasresulted in the replacement of a considerable number of information systems (IS) byone single ERP system. ERP systems are large and complex integrated softwarepackages that support standard business activities (Oliver and Romm, 2002). Recently,universities have turned to ERP systems as a means of replacing existing managementand administration computer systems. Since universities have problems common to awide range of organisations, the standard tools of contemporary organisationalanalysis and institutional management that include computer systems used by largecorporations around the world, such as ERP systems can be similarly applied in theircase also (Pollock and Cornford, 2004).

The Emerald Research Register for this journal is available at The current issue and full text archive of this journal is available at

www.emeraldinsight.com/researchregister www.emeraldinsight.com/1741-0398.htm

The authors wish to thank the editor and the two anonymous referees of the Journal of EnterpriseInformation Management for their helpful comments and suggestions.

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The Journal of Enterprise InformationManagement

Vol. 18 No. 2, 2005pp. 195-210

q Emerald Group Publishing Limited1741-0398

DOI 10.1108/17410390510579918

In order to put into effect the application of the double entry accounting system at alarge public university in Northern Greece (an institution we will refer to asuniversity), a new specific ERP system was installed, which involved the employees,operations and information related to the university. The main characteristic of an ERPsystem is that it deals primarily with the integration of the financial operations of apublic university, through the implementation of a hybrid double entry accountingsystem where public and financial accounting function in parallel. The objectives of theuniversity administration are to improve efficiency by operating the ERP system andto fulfil legal requirements as regards the application of a double entry accountingsystem. Despite the initial foreseen difficulties and the objections of the personnel inrelation to the ERP, it becomes obvious that the staff from the university accounting financial sector responded positively to its use. The benefits from the ERP system,according to users perceptions, focus on three dimensions in the following order:

(1) managerial;

(2) operational; and

(3) information technology (IT) infrastructure.

The purposes of this study are:. to provide empirical evidence, based on an analysis of users

expectations/perceptions, on the impact of the ERP system implementation inimproving efficiency at the university, with particular emphasis on theaccounting information and management; and

. to check whether the theoretical sources of ERP systems benefits wereobservable in our study.

The empirical evidence presented in this paper, along with previous research, can thenhelp the university and other public organisations to establish the best way forward infully exploiting the ERP systems potential as an innovative tool for management.

The paper is organized as follows: the first section contains a review of the relevantliterature. In the following sections, the research methodology and results arepresented; and in the final section, the conclusions and implications drawn from thisresearch are discussed.

A review of related literatureERP system benefitsGeneric software packages, such as ERP systems, cover the fullest range oforganisational activities and processes and are adopted with the aim of achievingsubstantial cost savings as well as improved access to tried and tested solutions; theyalso provide an opportunity to update procedures and align them with perceivedexamples of best practice (Pollock and Cornford, 2004). An ERP system encompassesa set of business applications (modules) used to carry out common business functionssuch as accounting, stock control, logistics etc. The essence of a complete ERP systemis to automate business processes, share common data across the organisation but,most importantly, to produce real-time data (Nah et al., 2001; Themistocleous et al.,2001). Although conventional IS offer managers services in transaction processing,reporting and provide information for decision-making purposes, these functionsappear insufficient in the new business environment where automation, effectiveness

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and efficiency in operations, plus real-time data are considered important factors forbusiness success (Al-Mashari, 2001; Themistocleous et al., 2001). Furthermore,improved planning and control of operations are also the result of ERP applications.ERP systems are capable of producing real-time information for management torespond to, thus improving control and strategic decision-making (Spathis andConstantinides, 2003). Also ERP systems offer companies the ability to improve theirbusiness processes by integrating all the functional areas within an organisation.

Determining the benefits derived from the implementation of information systemshas been an elusive goal for academics and practitioners alike. Irani and Love (2001)proposed a framework for the challenges associated with categorising benefits. In acase study of a manufacturing resource planning (MRP) II investment, it was observedthat, as one moves from strategically-oriented IS projects through tactical tooperationally-oriented projects, the benefits accrued go from those that are generallyintangible and non-quantitative in nature to more tangible and quantitative ones. Acomprehensive framework for assessing the benefits of ERP systems is proposed in astudy by Shang and Seddon (2000, 2002). This framework tries to classify the types ofbenefit that organisations can gain by using ERP systems along five dimensions:operational, managerial, strategic, IT infrastructure and organisational. The presentstudy examines the benefits related to accounting information and management on ashort-term rather than on a long-term basis. That is why it focuses mainly on three ofthe five dimensions (managerial, operational and IT infrastructure). Paradoxically,ERP projects are often considered to be strategic imperatives, but are usually justifiedusing operational factors (Murphy and Simon, 2002).

A study was conducted in Australia addressing the impact of an ERP system onaccounting practices (Booth et al., 2000). The researchers evidence suggests that ERPsystems have proved to be quite effective in transaction processing but less effective inreporting and decision support. Granlund and Malmi (2002) argue that a commonorganisation-wide information structure and integrated information system couldproduce significant benefits for global organisations. It has been found that ERPsystems provide general benefits in terms of increased transaction processingefficiency, more accessible information of a higher quality and greater support for adhoc reporting. Evidence from a survey on companies who have adopted ERP systemsand their impact on management accounting practice confirms a number of suchbenefits (Spathis and Constantinides, 2002). The most highly-rated perceived benefitsinvolve increased flexibility in information generation, improved quality of reports,increased integration of accounts applications and improved decisions based on timelyand reliable accounting information. Evidence suggests that businesses expect ERPsystems to deliver improved company performance. More specifically, ERP systemsare expected to:

. reduce costs by improving efficiency through computerisation; and

. enhance decision-making by providing accurate and updated organisation-wideinformation; both of which should then lead to improved company performance(Poston and Grabski, 2001).

On the other hand, substantial cost and time overruns, plus organisational problemsincluding employee resistance to change appear as important barriers for ERP systemsuccess (Nah et al., 2001, Themistocleous and Irani, 2001; Themistocleous et al., 2001).


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Some studies have tried to address this problem by identifying change managementstrategies that facilitate the success of ERP implementation (Pardo del Val andFuentes, 2003). Fundamental sources of resistance to technological change in the formof an ERP system are:

. perceived risk associated with decision to adopt the change; and

. habit, which refers to current practices that one is routinely using.

The present section introduced the topic of ERP system benefits, specifically asregards their importance in relation to accounting information and management. Theframework of ERP system benefits by Shang and Seddon (2002)) was chosen as themost representative example in order to assess the benefits in accounting informationand management, since no relevant framework exists to date in the accounting field.The next section introduces the topic of expectations and perceptions of IT users.

Expectations and perceptions of IT usersInformation technology (IT) user expectations are potentially an important factoraffecting the perceived benefits arising from the use of new information systems (IS)(Mahmood et al., 2000). Therefore, it is no surprise that managing user expectations hasbecome a difficult but essential task. Managers who develop effective strategies alongthese lines can potentially enhance the success from the implementation of new IS (Stapleset al., 2002). A recent meta-analysis of factors that influence end-user satisfaction locatedseveral studies that examine the link between user expectations and user satisfaction(Mahmood et al., 2000); and a relative positive association was identified. This suggeststhat creating high expectations can result in achieving higher user satisfaction. One verysignificant limitation of almost all these studies, as pointed out by the authors, was thatthey were cross-sectional (i.e. measured at one point in time). Expectations were measuredfollowing implementation. This method can introduce recollection errors (Lawrence andLoh, 1993), and does not assess the match between expectation and experience. Mahmoodet al. (2000) conclude their meta-analysis by calling for more focused research vialongitudinal studies at pre-implementation and post-implementation time periods.

There are two field-based studies that have examined the effect of expectations onperceived user benefits by measuring expectations prior to the implementation of an ISand views on actual post-implementation use. Ginzberg carried out the first study in1981 and Marcolin the second in 1994. In both of these studies, the researchers foundthat unrealistically high expectations led to lower levels of user satisfaction. In thestudy by Marcolin (1994), the disconfirmation theory, taken from literature onconsumer satisfaction, was used to explain user satisfaction. The disconfirmationmodel from marketing literature (Kennedy and Thirkell, 1988), proposed by Churchilland Surprenant (1982), used an individuals perceived expectations, perceivedperformance, and perceived disconfirmation to predict consumer satisfaction.Confirmation of expectations can be made at three possible levels:

(1) confirmed when the product performs as expected (expectations matchperceived performance);

(2) negatively disconfirmed when the product performs worse than expected; and

(3) positively disconfirmed when the product performs better than expected(Oliver, 1980).

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Marcolin (1994) compared pre-use expectations of an IS with post-use perceptions ofsystem performance. She found that when the system performed worse than expected,the user satisfaction was lower than if the system had performed as expected.Therefore, as with Ginzbergs (1981) results, and in accordance with thedisconfirmation theory, Marcolin (1994) found that unrealistically high userexpectations were associated with lower levels of satisfaction. Thus, there isstronger support in favour of using the disconfirmation theory rather than thecognitive dissonance theory.

Staples et al. (2002) have examined the relationship between pre-implementationexpectations and their perceived benefits based on post-implementation experience.They found that unrealistically high expectations would result in lower levels ofperceived benefit than those associated with realistic expectations. One set of findingssuggests that high expectations are good; another set of findings suggests thatmanagers should avoid creating expectations that are unrealistically high.

Research questionsThe present study was undertaken after reviewing existing literature on ERP systemsand in view of our experience as consultants for the new ERP system at the university.Its focus is to assess the extent to which the introduction of a new ERP system can assista public organisation, such as the university, in achieving its aims, while focusingattention on improved efficiency in the managerial, operational, and IT infrastructurefield. This study purports to examine the views of users who adopted the ERP system,by comparing pre-implementation expectations with post-implementation perceptionsconcerning the systems benefits to the accounting information and management, as wellas its impact on improved efficiency at the university. The study was also intended toinvestigate the relation between how realistic initial expectations were and what theireffect was on the perceptions related to the resulting benefits from the use of the ERPsystem. Finally, the study aimed to diffuse the above-mentioned results in order to offeradvice to managers and provide guidance for future research.

This study examines the following research questions:. What are the perceived benefits to the accounting information and management

of a large public organisation that derive from the adoption of an ERP system?. How are the perceived benefits grouped in relation to the various dimensions?. Are there differences between users expectations and perceptions, as regards the

benefits to the accounting information and management that are associated withthe adoption of a new ERP system?

DataIn order to provide accurate information, the case study used structured questionnairesin two-measurement points (pre- and post-implementation) in the frame of longitudinalresearch. We were able to conduct a survey among IT users belonging to the universitystaff (in the finance and accounting sector), both one month prior to implementation(December 2001) and one year following implementation (January 2003) of the newERP. To measure individual disconfirmation values we required matched responsesfrom university staff that had filled out both questionnaires. During the survey, thequestionnaires were distributed, filled in and returned. Each questionnaire was


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accompanied by a cover letter from the university financial manager asking therecipient to complete the said questionnaire. The same procedure was used during bothtime periods to collect questionnaires from the same users. The users were asked toexpress their views on the questionnaire.

Questionnaires were sent out to a randomly selected set of 61 users, 43 of whichfinally agreed to participate in the survey concerning their expectations andperceptions of the new ERP system. This amounted to only about 70.49 per cent of thesubjects in the department, since the financial sector university staff also wantedinformation related to views of the current system being used. The samplecharacteristics are summarised in Table I.

The questionnaire consisted of three parts: the first part contained statements (20items) about the benefits of ERP systems to the accounting information andmanagement, based on perceptions and expectations taken from related literature andmodified by the authors to suit the university case. A seven-point Likert scale (1 notat all, 7 excellent degree) was created for this study based on three of the fivedimensions linked to ERP system benefits (Shang and Seddon, 2000). The second partaimed at building a demographic profile of ERP system users. The third part containedviews on training, implementation problems and re-engineering needs related to theERP system. In order to arrive at estimates of the match between expectations andactual use, we calculated the difference between the respondents post-implementationevaluation of the construct measures and their responses on pre-implementationexpectations.

Number Per cent

A. PersonalA1. Gender

Male 20 46.5Female 23 53.5

A2. Age25-34 years 5 11.635-44 14 32.645-54 20 46.555-65 4 9.30

A3. EducationSecondary School Graduate 23 53.5University Graduate 20 46.5

B. PerceptionsB1. Training benefits

Yes 31 72.1No 7 16.3I did not participate 5 11.6

B2. ERP system implementation problemsYes 26 60.5No 5 11.6I do not know 12 27.9

B3. Re-engineering needsYes 42 97.7No 1 2.3

Table I.Users demographiccharacteristics andperceptions

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To establish readability along with face and content validity, the questionnaire waspilot-tested in collaboration with the ERP provider (whom we will refer to asprovider) at five different public organisations prior to implementation. Feedbackfrom pilot-study testing was used to refine the format of the questionnaire items byaddition, removal, or rephrasing of items as necessary. The scale was tested for variousvalidity and reliability properties. Construct validity was assessed by both convergentand discriminant validity using factor analysis (principal component analysis withvarimax rotation). Discriminant validity was assessed by examining the rotatedcomponent matrix to ensure that items did not cross load on multiple factors.Reliability analysis was assessed using Cronbachs alpha. Based on an extensiveexamination of the psychometric properties of the scale, we can conclude that eachvariable represented a reliable and valid construct.

The statistical analysis methods employed were:. factor analysis to evaluate the scale of measurement related to benefits for the

university from the ERP system; it was used to combine the characteristics into asmaller number of principal factors and to control the structure and validity ofthe proposed questionnaire;

. Cronbachs alpha was used to assess the reliability of the scale, which providesan indication of the internal consistency of the items measuring the sameconstruct; and

. t-test (paired samples) to assess the significance of the mean values by variablebetween the two periods (Hair et al., 1992; Zikmund, 1994).

Research methodologyThere is a strong case study tradition in the academic field of IS management. The casestudy methodology, which is an umbrella term, does not impose any specific researchtechnique, but rather defines a context (Bell, 1993). Case study is now accepted as avalid research strategy within the IS research community (Klein and Myers, 1999).Case research moves away from rigour towards practicality, which may suggest morerelevance for practitioners. The natural setting gives case researchers the opportunityto conduct situational and in-depth studies of complex phenomena that are not alwayspossible because of the restrictions on studies conducted under laboratory conditions.In natural settings, researchers are able to explain more clearly the causal linksthrough real-life interventions, describe the real-life context in which an interventionoccurred and explore those situations in which the intervention being evaluated has noclear, single set of outcomes (Yin, 1994). The purpose of a case study is to illuminate adecision or a set of decisions, which conform to the direction of the said research.

Universities were chosen for the case study for a number of reasons: universities aresubstantial and experienced users of IT and a significant number have emerged aspurchasers of ERP systems (Oliver and Romm, 2002); Rands (1992) argued that therequirements for software acquisition vary considerably across different industries.Universities are a specific vertical market targeted by ERP vendors; whichconveniently identifies stability on the supply side as well as on the demand side.Studies on the implications of ERP systems for universities have been carried out(Scott and Wagner, 2004; Pollock and Cornford, 2004). Cunningham et al. (1998)mention the potential use of ERP in reshaping organisational aspects. Heiskanen et al.


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(2000) have conducted a detailed study of the use of software packages but concludethat such industry standard systems are inappropriate in such a setting, as universitiesconstitute a unique type of organisation. Pollock and Cornford, (2004) suggest that thesignificance of these systems would be better appreciated and understood, if we wereto resist viewing universities (or, for that matter, computer systems) as stable entities.

The caseThe university under study is today the largest public institute of higher education inGreece and one of the largest in Europe. It consists of 38 departments, comprising tenfaculties (schools), with an additional three functioning as independent departments.Its active student population is estimated to be over 60,000. The university also hasschools in other parts of the country, which constitute separate universities. Accordingto legislation, all public legal entities, such as the university, must apply the doubleentry accounting system. This includes the obligation to:

(1) Keep corresponding ledgers and issue the proper documentation.

(2) Prepare a specific accounting plan that includes three accounting cycles, eachfunctioning autonomously but also in parallel with the other two:. financial accounting;. cost and management accounting; and. budget accounting.

(3) Issue financial statements, i.e. balance sheet, profit loss accounts, profitdistribution and annex.

All the above-mentioned procedures should be carried out in conformity with therelevant laws regarding the observance of a specific accounting plan and the issuing offinancial statements by public organisations.

Spathis and Ananiadis (2004) have examined the new accounting system in relationto the ERP system reform at the university. More specifically, they have examined theallocation of resources to faculties by the university management team using specificcriteria (a fund distribution formula), and the measurement of performance indicators,with the accounting contribution emphasized in relation to expenditure over a 12-yearperiod. According to their findings, the introduction of the new double entryaccounting system has resulted in a more equitable allocation of resources at theuniversity, the improvement of productivity in the accounting-financial departmentsand upgraded information provision to the university management team.

With the application of the new double-entry public accounting system at theuniversity at the end of 2001, a new specific ERP system was installed and operates todate by integrating all accounting and financial operations. It was the first time that alarge Greek university installed a specialized ERP system and its implementation hasbecome a standard for other universities in the country. The provider, which wasassigned the development, installation and support of the ERP system for integratedfinancial management, was one of the main Greek software houses, with extensiveexperience in installing systems within private companies and public organisations.The authors of the present paper also participated in the workgroup. Furthermore, theprovider undertook the task of personnel training in collaboration with the university.Because of the inherent nature of ERP packages, training users is critical (Bingi et al.

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1999), since one of the greatest advantages of ERP systems, i.e. the integration of data,can become a double-edged sword when errors are introduced into the system.

The university management was strongly in favour of the introduction and effectiveoperation of the new ERP system, and also provided support throughout all phases ofimplementation leading to successful results. In addition, the management of thefinancial department fully comprehended the systems significant contribution to theaccounting process and encouraged the personnel by creating positive expectations asregards subsequent improvements to the public organisations performance. Theystated that the new ERP system would encourage the development of procedures andpractices more commonly followed in large organisations and known as best businesspractice:

I think the reason why all larger universities are beginning to move towards ERP systems, isthe existing complex environment, which in essence drives large organisations towards theestablishment of highly decentralised structures. The operation of the new enterprise systemwill improve the exploitation of financial resources and improve all financial and managerialoperations in the university (interview with the universitys financial director).

The modules of the ERP system include the following three main categories:

(1) Accounting financial. Double entry accounting system, cost and managementaccounting, public budget accounting.

(2) Procurements of the purchase office. Purchase schedule, management ofsuppliers, offers and contracts.

(3) Management information system. Active reports, OLAP online analyticalprocessing, hierarchical data views, query viewer, graph reports.

The implementation stage took into account the basic preconditions of entering aminimum of required information on a one-off basis, the particular functionalproperties of a public organisation, and the needs of management and universityfaculties as regards information provision.

This empirical study focused on IT users among the university staff, since thebenefits from ERP adoption are directly linked to that user group. The acquisition ofnew skills, greater job satisfaction and empowerment were presented as the benefitsfrom ERP adoption. It was suggested that by participating in the ERP project orworking in areas that make use of new administrative systems, staff would acquirenew skills for enhancing employment or promotion prospects, as well as job security. Itwas also suggested that staff empowerment would also be a consequence of the needfor more varied and responsible roles required in the implementation of revisedbusiness processes.

Results and discussionTable I shows the sample distribution as related to personal characteristics andperceptions from the pre-implementation period. Concerning the issue of userperceptions, the majority (72.1 per cent) of users say they have benefited from the ERPsystem training.

As regards ERP system implementation problems, the majority (60.5 per cent)recognizes that these do exist, since the operation of the ERP system is still at thepre-implementation stage. An overwhelming majority, i.e. 42 out of 43 ERP system


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users, also considers that a re-engineering and re-organisation of their departments isessential, within the framework of the new ERP system operation.

With the use of factor analysis, we examine the main dimensions that formulate theimpact perceptions of ERP system benefits to the accounting information andmanagement.

As can be seen in Table II, principal component analysis and Varimax with Kaisernormalisation rotation methods pointed to a total of three factors, which explain 74.334per cent of the total variance. This percentage is particularly high and is consideredvery satisfactory. The evaluation of the number of factors was carried out using theeigenvalue criterion, which was greater than the unitary (Hair et al., 1992). The analysisrevealed a clear structure between the factors and the loadings of the correspondingvariables. The Kaiser-Meyer-Olkin measure of sampling adequacy is high, suggestingthat factor analysis is appropriate for this data set. Bartletts test of sphericity is largeand the associated significance level is small (zero), therefore it is unlikely that thepopulation matrix is an identity. With regard to the reliability of the scale

Dimensions and items of ERP system benefits LoadingsPer cent ofvariance

Cronbachsalpha

Factor 1: Managerial benefits 32.570 0.947Q2. Improved follow-up of assets 0.888Q1. Improved exploitation of financial resources 0.864

Q10. Increased flexibility in information provision 0.757Q9. Improved cash control liquidity 0.755

Q15. Improved decision making after timely provision of reliableinformation 0.735

Q17. Easier handling of the new programme 0.728Q8. Increased effectiveness of internal control 0.703

Q19. Improved services of suppliers 0.666Q20. Increased clarity of financial management 0.650Q14. Necessary integration of functions among departments 0.493

Factor 2: Operational benefits 21.069 0.895Q6. Improved quality of reports payment orders 0.876Q5. Less time for issuing reports payment orders 0.828Q4. Less time for document entry 0.817Q7. Fewer errors on data entry 0.671Q3. Less time for annual closing of accounts 0.602

Factor 3: IT infrastructure benefits 20.695 0.875Q13. Decreased total operational costs 0.862Q12. Personnel re-organisation 0.743Q18. Improved maintenance of common databases 0.717Q11. Improved document circulation 0.604Q16. Improved communication between employees and

management 0.570Total variance explained (%) 74.334KMO 0.810Bartletts test of sphericity Approx. Chi-Square 843.881

df 190Sig. 0.000

Table II.Factor analysis andreliability scores of ERPsystem benefits

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measurements in relation to the variables composing each factor, the alpha-Cronbachcoefficients were calculated and judged satisfactory between 0.947 and 0.875. Highvalues of Cronbachs alpha indicate high internal consistency of the multiple itemsmeasuring each construct and, hence, high reliability of the individual constructs.

The first factor refers to the managerial benefits from the ERP system including allrelevant items. The item with the higher loading is improved follow-up of assets and isfollowed by improved exploitation of financial resources. According to the results, thesecond most important factor affecting perceptions on operational benefits is the impactof the ERP system. The items with the highest loading refer to improved quality ofreports and payment orders, and to the decrease in the time needed for issuing reportsand providing input. The introduction of the new ERP system results in a substantialreduction of errors, as well as time needed for the annual closing of accounts. Theabove-mentioned results are incorporated within the important support and flexibilitystructure that the ERP system provides, as well as in the reduction of respective IT costs.The third factor refers to the IT infrastructure benefits from the ERP system. The itemswith the highest loadings refer to the decreased total operational costs, personnelre-organisation and improved maintenance of common databases. The usersperceptions presented above point towards a reduction of university operational coststhrough increased productivity, and a reduction in personnel, as a result of there-organisation and functional re-engineering that will be required.

Table III compares pre-implementation expectations with post-implementationperceptions. In all 20 items, users perceptions during the post-implementation periodreceive a higher level of mean values compared to those of the pre-implementationperiod.

When applying the test on the paired differences between the mean scores of the twoperiods, it is noted that in all 20 items, the differences were statistically significant at thep , 0:000 and p , 0:001 levels. The difference between the two periods can beexplained as a result of the great technological void that exists between the old IS andthe new ERP system. Based on Windows technology, the new ERP system offersnumerous operational solutions and facilitates the work of users when compared to theprevious system. Furthermore, resistance to technological change due to habit made thepublic university users quite reserved, despite the relevant training that took place. Thenew ERP system contributes significantly towards increased flexibility in informationprovision; effective monitoring and exploitation of the universitys assets andrevenue-expenditure flow, and improved decision-making. Moreover, the quality andreliability of financial statements is improved, along with the relevant information usedto calculate respective indicators. The results as regards the benefits of the ERP systemagree with the classification of Shang and Seddon (2000, 2002) on this issue. Moreover,they agree with research carried out by Spathis and Constantinides (2002, 2003) andBooth et al. (2000) on the impacts of ERP on accounting processes and contradict Stapleset al. (2002), whose users expectations outweighed their final perceptions.

Researchers have often attributed many implementation problems to usersresistance to change (Pardo del Val and Fuentes, 2003). Issues related to userexpectations thus need to be addressed, since the university has illustrated how insteadof increased efficiency, there was initially a drop in productivity amongst universitystaff, as a result of time spent learning about the new system. In this study, one yearpost implementation, the users perceptions were more positive. The effective training


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that preceded it played a decisive role in familiarizing users with the new ERP system.Managing these particular types of expectation during the early stages of the projectshould have the most positive benefit on user perceptions once the system isimplemented. Problems were observed in the implementation of ERP systems in otheruniversities. The main cause was the pressure on staff to rethink many of the existingprocedures and concepts according to new business process terms and enterpriseterminology, even when this caused confusion and irritation (Pollock and Cornford,2004; Scott and Wagner, 2004). It is also clear that changes in processes also bringabout organisational reforms. That is why ERP systems for universities need to bespecifically designed to meet their particular requirements and operations.

In Greece, this is the first time that the benefits of the ERP system on the accountinginformation and management of a public organisation (such as a university) have beenstudied. This case provides a useful illustration of good practice and sets forth theframework for benefits related to the accounting processes and management of apublic organisation, when ERP is applied. Following the successful implementation ofthe ERP system at the university, the installation of the same version followed in otherGreek universities also. The universitys experience in ERP implementation thusoffered a learning opportunity for all those universities seeking a competitiveadvantage through technology management.

Pre-implementation

Post-implementation

ERP system benefits Mean SD Mean SD t-testa

1. Improved exploitation of financial resources 5.05 1.73 5.42 1.63 24.989**2. Improved follow-up of assets 5.26 1.59 5.56 1.47 23.862**3. Less time for annual closing of accounts 4.40 1.64 5.00 1.60 25.444**4. Less time for document entry 3.19 1.74 4.07 1.65 29.268**5. Less time for issuing reports payment orders 3.33 1.74 4.21 1.63 28.751**6. Improved quality of reports payment orders 4.09 1.54 4.67 1.55 26.089**7. Fewer errors on data entry 4.49 1.39 5.05 1.21 24.435**8. Increased effectiveness of internal control 4.77 1.51 5.21 1.30 24.914**9. Improved cash control liquidity 5.07 1.47 5.47 1.32 25.240**

10. Increased flexibility on information provision 5.26 1.63 5.53 1.47 23.634*11. Improved document circulation 4.37 1.57 4.91 1.52 25.257**12. Personnel re-organisation 4.21 1.64 5.07 1.39 27.598**13. Decreased total operational cost 3.91 1.66 4.91 1.46 26.557**14. Necessary integration of functions among

departments 4.88 0.96 5.35 1.00 24.571**15. Improved decision making after timely

provision of reliable information 5.07 1.47 5.44 1.18 23.722**16. Improved communication between the

employees and management 4.88 1.45 5.33 1.34 23.641*17. Easier handling of the new programme 4.40 1.64 5.05 1.45 24.627**18. Improved maintenance of common databases 4.70 1.37 5.28 1.22 27.638**19. Improved services of suppliers 4.53 1.65 5.28 1.44 27.416**20. Increased clarity of financial management 5.33 1.29 5.98 1.20 26.565**

Notes:a All paired differences are significant (two-tailed) at * p , 0:001; ** p , 0:000Scale: 1 Not at all; 2 Very low degree; 3 Low degree; 4 Average degree; 5 High degree;6 Very high degree, 7 Excellent degree

Table III.Comparisons of meanvalues with t-test ofpre-implementationexpectations andpost-implementationperiod perceptions(paired samples)

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Conclusions and implicationsThe research that was conducted, aimed at locating the dimensions that had an effecton the accounting process and management of the university following theintroduction of the new ERP system. The latter was deemed necessary along withthe simultaneous application of the double entry accounting system at the university.Thus, the technique of assessing users perceptions was selected, for the reason that theERP system operation is still in a pre- and post-implementation phase and there is notyet any numerical data available to compare with past situations. The structure of thedistributed questionnaire was based on a careful study of the international literature onthe subject. According to the results, the benefits from the introduction and operationof the new ERP system on the accounting information and management of universitywere identified according to the perceptions of users from the accounting and otherfinancial departments.

The factor analysis of the benefits from the implementation of the ERP system showthat managerial benefits come first, operational benefits follows, while ITinfrastructure benefits are in the third position. The university should exploit theabove-mentioned positive impacts and use them in order to ensure effectiveexploitation of its resources, and in relation to its decision-making processes followingthe direct supply of valid and reliable information.

The above case involves a number of managerial implications concerning ERPsystems, which are substantiated by the research literature. This study hasimplications both for public sector organisations and IT professionals, in that itprovides some explanation of factors that involve benefits to accounting informationand management. These results can help the management of public organisations toestablish the best way forward in fully exploiting the potential of future ERPapplications. This case illustrates how the public sector reforms effectuated for theapplication of the double entry accounting system at the university have had a radicalimpact on accounting processes and management. In relation to these changes, theuniversitys strategic response identified flexibility and time (speed) as the mainparameters affected. ERP systems are thus now becoming an essential tool fororganisations wishing to remain competitive in the education sector, i.e. universities.

Nonetheless, ERP systems also offer the opportunity for organisations tore-engineer their activities and revamp their information systems and accountingpractices. For the staff, clearly opportunities arise to acquire marketable skills relatedto the process of installing and using new technology. The ability of a university toteach and conduct research more effectively as an indirect result of installing thesesystems is also postulated. This suggests that the adoption of ERP systems may, tosome degree, be conducive in attaining broad-reaching goals beyond the immediateimpact zone of the system itself. Such issues relating to the nature of work and theattainment of strategic institutional goals are important in every institutional context,not just in universities.

Several limitations of the study should be addressed. One of these is its relativelysmall size. The responses can be compared more confidently because all surveyrespondents represent the same level of analysis. This enhances the internal validity ofthe study. The finding that some potential benefits from the ERP system have not beenhighly rated might be attributed not only to the infancy of these systems but also, tothe fact that not all functional areas were integrated yet. In any case, the complexity of


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ERP systems suggests that benefits are accrued in the long-term (Poston and Grabski,2001). It is worth noting that the results of this study pertain to a public university andcannot be compared directly with the respective results of private companies.

Future research could focus on other dimensions of ERP system benefits such as theorganisational and strategic field. A future study with financial data could compare theefficiency ratios before and after the ERP systems operation at the university in orderto evaluate the calculated benefits from its implementation. Future research mayfurther examine expected as opposed to actual benefits derived from ERP applications(on an individual basis), as well as the impact of technical, organisational and financialproblems in fully exploiting ERP systems within an accounting context. It is plausiblethat, ERP system implementations require a reformulation of business processes andorganisational structures but most importantly a change of management style andculture. Furthermore, collaboration within the organisation and between theorganisation and the ERP provider also appears as a critical success factor in ERPapplications. In addition, the importance of top management support, includingemployee training/participation should not be underestimated.

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